New York Law Review

Tag: Exactions

  • Twin Lakes Development Corp. v. Town of Monroe, 1 N.Y.3d 100 (2003): Constitutionality of Fixed Development Fees

    Twin Lakes Development Corp. v. Town of Monroe, 1 N.Y.3d 100 (2003)

    A municipality can impose fixed per-lot fees on developers for recreational purposes in lieu of parkland dedication, provided there’s an essential nexus between the fee and the development’s impact, and the fee is roughly proportional to the recreational needs generated by the development.

    Summary

    Twin Lakes Development Corp. challenged the Town of Monroe’s requirement that developers pay fixed per-lot fees for recreational purposes and consulting costs. Twin Lakes argued that these fees constituted an unconstitutional taking and violated due process. The New York Court of Appeals held that the fixed recreation fee was constitutional because it met the “essential nexus” and “rough proportionality” tests established in *Dolan v. City of Tigard*. The court also found no due process violation in the consulting fee requirement because the Town Code provided sufficient mechanisms for ensuring the fees were reasonable, and Twin Lakes had not availed itself of these mechanisms. The court affirmed the dismissal of Twin Lakes’ complaint.

    Facts

    Twin Lakes Development Corp. sought approval to subdivide a 28-acre parcel into 22 residential lots in the Town of Monroe. As required by Town Code, Twin Lakes deposited funds into an escrow account for consulting costs. The Planning Board granted conditional final approval, mandating per-lot payments in lieu of parkland dedication and reimbursement for consulting fees. The “in lieu of” payments were set at $1,500 per lot, as per Town Code.

    Procedural History

    Twin Lakes paid $33,000 in “in lieu of parkland” fees and $22,000 in consulting costs, allegedly “under protest.” Instead of challenging the Planning Board’s determination directly, Twin Lakes filed a declaratory judgment action to invalidate the fee provisions on constitutional grounds. The Supreme Court granted the Town’s motion for summary judgment, dismissing the complaint. The Appellate Division affirmed. Twin Lakes appealed to the New York Court of Appeals.

    Issue(s)

    1. Whether the Town’s $1,500 per-lot recreation fee constitutes an unconstitutional taking because the fee is not based on an “individuated assessment” of the recreational needs generated by its subdivision plan.
    2. Whether the Town Code violates procedural due process because applicants cannot challenge the amount of the recreation fee as excessive in relation to a particular subdivision plan.
    3. Whether the requirement to pay consulting fees without an express audit component violates due process.

    Holding

    1. No, because the Town made explicit findings connecting the need for recreational facilities to the subdivision’s impact and the fee is roughly proportional to that impact.
    2. No, because the recreation fee requirement is generally applicable, was adopted after a public hearing, and the Town revisits the fee schedule annually, allowing property owners to voice objections.
    3. No, because the Town Code limits fees to those that are “reasonable,” the Town interprets fees as subject to audit provisions, and the Town has processes in place to ensure fees are not excessive.

    Court’s Reasoning

    The court applied the “essential nexus” and “rough proportionality” tests from *Dolan v. City of Tigard* to the recreation fee. The court found an essential nexus because the Town made explicit findings that the demand for recreational facilities exceeded existing resources and that subdivision development exacerbated the problem. The statute also mandated that fees be used strictly for recreational purposes. The court stated, “Taken together, these factors clearly establish the essential nexus between the stated purpose of the condition and the fee.”

    Regarding rough proportionality, the court held that Twin Lakes failed to prove that the $1,500 per-lot fee was disproportionate to the development’s impact. The court distinguished *Garden Homes Woodlands Co. v. Town of Dover*, noting that the per-lot fee was neither a special assessment nor a tax but a generally applicable land-use regulation. The court highlighted *Jenad, Inc. v. Village of Scarsdale*, stating that the fee “was merely a kind of zoning, like set-back and side-yard regulations, minimum size of lots, etc., and akin also to other reasonable requirements for necessary sewers, water mains, lights, sidewalks, etc.”

    As for the consulting fees, the court noted that the Town Code limited fees to those that were “reasonable” and that the Town interpreted the fees as subject to audit provisions. Because Twin Lakes did not allege the fees were unreasonable or request an audit, the court found no due process violation. The court emphasized, “Under these circumstances, plaintiff has failed to establish a due process violation.”

  • Jenad, Inc. v. Village of Scarsdale, 18 N.Y.2d 78 (1966): Upholding “Money in Lieu of Land” Exactions for Subdivision Approvals

    Jenad, Inc. v. Village of Scarsdale, 18 N.Y.2d 78 (1966)

    A village may validly authorize its planning board to require a subdivider to allot land for park purposes within the subdivision or, at the village’s option, pay a fee in lieu of such allotment as a condition for plat approval.

    Summary

    The Village of Scarsdale required Jenad, Inc., a real estate developer, to either dedicate land for park purposes within its new subdivision or pay a fee of $250 per lot into a fund for park and recreational purposes. Jenad paid the fees without protest and then sued to recover them, arguing that the requirement was an unconstitutional tax. The New York Court of Appeals held that the Village’s requirement was a valid exercise of its power to plan for the general welfare of the community and not an unconstitutional tax. The court reasoned that the exaction was a reasonable condition for subdivision approval, similar to zoning regulations and requirements for essential infrastructure.

    Facts

    Jenad, Inc. sought approval from the Village of Scarsdale Planning Commission for a subdivision plat. The Village’s regulations, specifically Section 2, Article 12, required subdividers to allot land within the subdivision for park purposes or, at the Planning Commission’s option, pay a fee of $250 per lot to be used for park, playground, and recreational purposes. Jenad paid the required fees without protest. Subsequently, Jenad sued the Village to recover the fees paid, claiming the requirement was an unconstitutional tax and an unauthorized taking of property.

    Procedural History

    Jenad, Inc. sued the Village of Scarsdale in New York state court to recover the fees paid under protest. The lower court ruled in favor of Jenad. The Appellate Division affirmed the lower court’s decision. The Village of Scarsdale appealed to the New York Court of Appeals.

    Issue(s)

    Whether a village can validly require, as a condition for subdivision plat approval, that a subdivider allot land within the subdivision for park purposes or, at the village’s option, pay a fee in lieu of such allotment.

    Holding

    Yes, because section 179-l of the Village Law grants villages the power to make such exactions as a reasonable form of village planning for the general community good, analogous to zoning regulations and infrastructure requirements.

    Court’s Reasoning

    The Court of Appeals reasoned that section 179-l of the Village Law empowers villages to require subdivision maps to show “a park or parks suitably located for playground or other recreation purposes.” While the statute doesn’t specifically authorize a “money in lieu of land” system, it allows the planning board to “waive” the parkland provision “subject to appropriate conditions and guarantees.” The court interpreted “appropriate conditions and guarantees” to reasonably include a fee per lot paid into a separate village fund used for park and recreational purposes. The court distinguished this case from Gulest Assoc. v. Town of Newburgh, where the town law amendment was deemed vague. In this case, the Scarsdale regulations specifically directed that the funds be used for the “acquisition and improvement of recreation and park lands.”

    The court rejected the argument that the fee was an unconstitutional tax, stating that it was a “reasonable form of village planning for the general community good,” akin to zoning regulations and requirements for essential infrastructure. The court noted that subdivisions increase the demand for recreational space and that requiring developers to contribute to parklands, either through land dedication or fees, is a reasonable way to address this increased demand. The court cited with approval decisions from Wisconsin (Jordan v. Village of Menomonee Falls) and Montana (Billings Props. v. Yellowstone County) that upheld similar requirements. The court in Jordan stated “a required dedication of land for school, park, or recreational sites as a condition for the approval of the subdivision plat should be upheld as a valid exercise of police power if the evidence reasonably establishes that the municipality will be required to provide more land for schools, parks, and playgrounds as a result of approval of the subdivision.” The court concluded that the fee was not a tax on the land, but a fee for obtaining plat approval.